It’s been less than a week since Amazon announced its decision to open half of its “second headquarters” in New York City, and the politicians involved in the deal are already in damage-control mode.
HQ2 was billed as a massive economic boon for the winning city — or, as it turned out, the winning cities — that would bring tens of thousands of high-paying jobs and billions of dollars in investments, but some New Yorkers opposed Amazon’s potential presence in New York from the outset. The day after the Amazon deal was announced, local politicians, community groups, and other protesters rallied against HQ2 in Long Island City, just blocks away from the proposed site of Amazon’s Queens campus.
Instead of responding to their critics in good faith, some of the officials involved in landing the Amazon deal — Gov. Andrew Cuomo, New York City Mayor Bill de Blasio, and Alicia Glen, the city’s deputy mayor for housing and economic development — are firing back, arguing that anyone who is opposed to Amazon’s impending Queens expansion is simply not paying attention to the facts.
Cuomo: Amazon’s critics aren’t being realistic
In a press release/op-ed published on his website Monday, Cuomo wrote off critics of the forthcoming development as a coalition of “extreme conservatives” and “socialists” united in both their opposition to corporate tax breaks and their disregard for political pragmatism.
The “extreme conservatives” at the New York Post oppose the deal, Cuomo claims, because they apparently think that instead of offering tax breaks to particular companies, New York should have a lower corporate tax rate. “It sounds simple and appealing, but it’s also unrealistic and impossible,” the governor writes, noting that New York has “cut taxes across the board” under his tenure. “Nothing in the Amazon transaction is new. The tax incentives we provide for single business transactions are usual and typical and have been operational for decades.”
This may not be an ideal situation, he says, but it’s the way things are. “One could argue that in a perfect world no city or state would be legally allowed to offer incentives and there would be no competition for individuals or businesses,” he writes. “True. But this is not a perfect world.” By trying to come off as the only adult in the room — the pragmatist who understands that the game is rigged but chooses to play it anyway — Cuomo instead reveals that he has no interest in making systemic changes to an inherently flawed system.
That brings us to the next band of seemingly unrealistic critics: “the socialists.”
These critics, Cuomo claims, are mad that New Yorkers are giving billions of dollars in subsidies to “one of the richest men in the country” instead of using those funds to provide services for “the poor and the needy.” This argument, while “politically appealing” and well-intentioned, is “once again wrong.”
“We give Amazon nothing and their revenues give us approximately $900 million annually,” Cuomo wrote, repeating a claim he made at a press conference last week announcing the Amazon deal. According to Cuomo’s calculations, New York isn’t really “giving” Amazon anything because the state will recoup $9 in revenue for every dollar given to Amazon in tax breaks and other subsidies. But that doesn’t mean that New York is giving Amazon nothing. In a blog post announcing its HQ2 selections, Amazon said New York state is giving Amazon the equivalent of “$48,000 per job for 25,000 jobs.” The state government is giving Amazon $1.7 billion in tax breaks and other incentives; the city is chipping in an additional $1.3 billion.
Assuming that Cuomo’s 9-to-1 calculation is correct, that figure still presumes that no other company would build on the land that has been set aside for Amazon. (The governor also claimed that New York would stand to “lose $900 million” if Amazon had decided to go somewhere else. It’s worth noting that not getting something is not the same as losing it.)
On a Monday segment of WNYC’s The Brian Lehrer Show, Cuomo repeated many of the arguments outlined in his op-ed, noting that people are right to be concerned about the state’s affordable housing crisis and the state of public transportation in New York City, but once again framing the Amazon deal as a net win for New Yorkers. “We won a competition that everyone was competing with, literally,” said Cuomo. “The upside was so huge — 25,000 jobs. We haven’t had a transaction like that in modern history.”
The governor was less clear on whether those 25,000 jobs would actually benefit New Yorkers. At one point, he said that the 25,000 figure would be added to New York’s existing population of 8 million, suggesting that Amazon wouldn’t be hiring from inside the city, or even inside the state. (“Forget the 25,000 additional people on 8 million,” he said. “We need to build more [housing] units.”) A few minutes later, though, he said that those high-paying Amazon jobs would go to New Yorkers. “Your assumption is that these 25,000 people are going to come from a different state; my assumption is that the 25,000 people are here now … These are good jobs for New Yorkers. It’s not a mass invasion of people from outside the state.” (A spokesperson for Cuomo did not respond to The Goods’ request for comment.)
But Amazon doesn’t have to hire locally if it doesn’t want to. Amazon may say it will hire New Yorkers — and that it will have job fairs to encourage people from “nontraditional backgrounds,” including residents of the nearby Queensbridge Houses and other public housing developments — but there’s no legal requirement for it to do so.
Cuomo seems to think that those who oppose the Amazon deal are refusing to engage with reality and looking for something to be outraged about. “I understand the current political intensity. This is a time of anger, frustration, and hyper-political extremes,” Cuomo wrote in his op-ed. “Symbolism reigns over reality. However, the bottom line is the bottom line, and facts are still facts.”
Other champions of the Amazon deal, though, are making a case for it as a progressive, forward-thinking company — and relying on the same political symbolism Cuomo claims to oppose.
Glen: Amazon’s NYC presence will benefit all New Yorkers
In an interview with New York Magazine published Monday, Alicia Glen, the city’s deputy mayor for housing and urban development, disregarded the notion that Amazon’s New York expansion would hurt working-class people.
According to Glen, Amazon is creating “thousands of high-paying jobs that would have otherwise been unavailable to New Yorkers.” (Nearly half of all tech workers in the city are foreign-born, Glen noted, and 40 percent are women. The assumption here seems to be that Amazon is good for immigrants and for women, and therefore immune to progressive opposition.) And even those who don’t get hired by Amazon stand to benefit from the “public benefits” the deal will bring, including additional funding for tech education and a waterfront park. “[I]f there’s anybody who thinks that creating more jobs that pay a lot of money, if that’s a bad thing, then we’ve really lost the forest for the trees,” said Glen.
But as Vox’s Matt Yglesias has written in the past, adding high-paying jobs to expensive cities is, at best, a mixed bag:
Over a decade ago, housing economists Janna Matlack and Jacob Vigdor investigated the economic impact of unequal economic development and found that “in tight housing markets, the poor do worse when the rich get richer.” A “tight” housing market, in this case, is a market like New York or greater Washington, where the cost of buying a house greatly exceeds the actual construction costs of new buildings. The problem in markets like these is that when the rich get richer — say because a new office complex opens and hires 20,000 to 30,000 people for six-figure salaries — the price of scarce housing rises.
If you actually get a job at Amazon or have the kind of job skills that you could plausibly get a job at Amazon, this will pay off for you because you’ll end up with higher wages that more than equal the higher rent. But if you work in a restaurant or cut hair or clean houses or drive a cab, you’ll probably end up worse off.
Glen claimed this wouldn’t be the case in New York City, because it’s “the exact polar opposite” of tech hubs like Seattle and Silicon Valley when it comes to affordable housing. “For the past four years, we’ve been the leader in affordable housing policy, if not in the country, in the goddamn world,” Glen said. “We have fundamentally changed the game, and so the lessons and the issues that are legitimately making people freak out on the West Coast simply don’t apply here.”
Even if New York is building more affordable housing units than Seattle or the Bay Area, it’s not enough to ward off the city’s ongoing housing crisis. A September report by Comptroller Scott Stringer’s office found that, as rents continue to climb, the amount of low-cost apartments continues to decline. Meanwhile, the city’s adult population continues to rise — and there aren’t enough apartments, affordable or otherwise, to meet the demand.
The affordable and subsidized housing that does exist isn’t without its own set of problems. Tenants who live in rent-controlled apartments are often subject to harassment by landlords who want to replace them with high-paying renters. Residents of the city’s public housing developments, meanwhile, often lack heat and hot water and are exposed to dangerous amounts of lead. The addition of 25,000 new, well-paid residents could make things worse for residents of public housing.
Glen’s suggestion that what’s good for white-collar tech workers is good for all New Yorkers is easily disproved by the city’s vast — and growing — inequality rate. As rich New Yorkers get richer, a growing number of households are “just one paycheck away from disaster,” as Kevin Baker wrote for Harper’s in July. Adding “more jobs that pay a lot of money” to New York’s economy, as Glen said, won’t necessarily make things better for the people who aren’t in the running to get those jobs in the first place.
De Blasio: Amazon is no Walmart
During his weekly “Ask the Mayor” segment on WNYC last week, Bill de Blasio defended the HQ2 deal by claiming that Amazon is a better corporation than many of its competitors.
“I’m going to ask all New Yorkers and particularly my fellow progressives to look carefully at what’s similar and what’s different here,” de Blasio said on the show, as per Crain’s New York. “Whatever you like or dislike about Amazon, Walmart is an entirely different universe, in terms of the systematic efforts they have undertaken to not only undermine labor, small businesses, the environment, American workers — and obviously the politics of the Walton family add to it.”
But much like Walmart — which has long been known for its substandard wages, erratic “flexible” scheduling, and anti-union stance — Amazon has also reportedly taken efforts to undermine both organized labor and small businesses. In September, Gizmodo obtained footage from an anti-union video Amazon sent to Whole Foods team leaders, which reveals the company’s anti-union stance. “We don’t believe unions are in the best interest of our customers, our shareholders, or most importantly, our associates,” the video says.
Employees from Amazon’s warehouses across the country have reported exploitative conditions, backbreaking labor, and low pay. In 2013, a warehouse employee died of dysrhythmia in one of the company’s Virginia fulfillment centers. The company’s stance on medical emergencies at the time, as per a Tennessee employee handbook: “Do Not call 911! Tell Security the nature of the medical emergency and location. Security and/or Amcare will provide emergency response.”
The big difference between Amazon and Walmart, as de Blasio unwittingly pointed out, is superficial. Jeff Bezos, Amazon’s billionaire founder and CEO, has reportedly donated millions of dollars to pro-LGBTQ campaigns, as well as thousands to Democratic candidates. (He’s also donated to a few Republicans.) In January, Bezos donated $33 million to a scholarship fund for undocumented students, just days after a federal judge blocked President Donald Trump’s attempt to end Deferred Action for Childhood Arrivals, or DACA.
More recently, though, Amazon pitched its facial recognition system to Immigration and Customs Enforcement. While Bezos donates to pro-immigrant causes, his company appears to want to help the Trump administration round them up so they can be deported. And after Sen. Bernie Sanders called Bezos one of the biggest recipients of corporate welfare, Amazon voluntarily raised its minimum wage to $15 per hour.
The notion that Bezos’s politics are more progressive than the Waltons’ is — to borrow Cuomo’s rhetoric — rooted in symbolism that reigns over reality. Amazon may hire women and immigrants, and it may even hire public housing residents, but these reasons alone don’t make HQ2 a good deal.
Instead of addressing the questions New Yorkers have raised about Amazon’s forthcoming expansion, Cuomo, de Blasio, and Glen are all using condescending doublespeak to dismiss their constituents’ concerns. If HQ2 were truly a good deal, there would be no need to obscure the truth.